Chinese, Indian Companies Apparently Lining Up to Buy Pieces of Zombie Saab

Saab apparently is not dead—it’s just in a persistent vegetative state. A total of five parties have stepped forward to bid on all or parts of the Trollhättan-based automaker as a bankruptcy court in Sweden manages the sale of the company’s assets. The aim is to recover some money for Saab’s creditors. The three parties receiving […]

Justin Berkowitz

Feb 3, 2012

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Saab apparently is not dead—it’s just in a persistent vegetative state. A total of five parties have stepped forward to bid on all or parts of the Trollhättan-based automaker as a bankruptcy court in Sweden manages the sale of the company’s assets. The aim is to recover some money for Saab’s creditors. The three parties receiving the most attention are two Chinese companies and Mahindra & Mahindra, an Indian automaker.

Zhejiang Youngman Lotus Automobile Co. is said to have made a bid in the hundreds-of-millions-of-dollars range for as much of Saab as it can get. Details of the offer haven’t been disclosed, but some very careful contracting must be on the table: Youngman tried to buy Saab before the bankruptcy, but General Motors ultimately vetoed that deal since it would have put so much GM-engineered Saab technology into the hands of a relatively small Chinese firm. It’s not clear what’s different this time around that might placate GM.

Beijing Automotive Industry Holding Company (BAIC) also has expressed serious interest in picking at Saab’s carcass. Saab sold the tooling and rights to build the old 9-5 to BAIC in 2009—it’s re-skinning them with more-modern sheetmetal—so this seems like a predictable move. Analysts like to say that the Chinese auto industry is developing quickly, which it is, but the benefit of building a car on even an old western platform can’t be understated.

Indian firm Mahindra & Mahindra—a major manufacturer of passenger cars, commercial vehicles, and agricultural equipment—is reported to have entered preliminary discussions to buy at least portions of Saab. These reports date back to December 30, however. As of this writing, Mahindra spokespeople weren’t available for comment.

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If you’re confused by this quagmire of news, it’s understandable. And you’re not alone. Saab is a relatively large industrial firm, and it’s going through a sophisticated bankruptcy process in Sweden. State- and privately held Chinese manufacturers are in some cases declining to be forthcoming about their positions in negotiations—and in other cases are legally required to stay quiet. Even international news organizations with staff on the ground in Sweden and China are relying in part on second-hand information.